From Question Mark to Landmark - Lexus Pursues Perfection in Its Third Decade

September 20, 2011

When Lexus was established in 1989, the luxury division of Toyota was determined to set a new course for the U.S. luxury auto industry. Over the past 22 years, Lexus has become a luxury automotive leader by building outstanding vehicles and providing superior customer service. Now, in its third decade, Lexus is even more dedicated to push the envelope to create the finest vehicles and to exceed customers’ expectations.

Lexus was created in response to Toyota owners’ wishes for a car that had the quality of their Toyota, but came in a more luxurious package. Since the first Lexus vehicles rolled out of dealers’ showrooms in September 1989, Lexus has emerged a leader in quality, innovation and, most importantly, in customer satisfaction.

This pursuit of perfection began in the early 1980s when then-Chairman Eiji Toyoda challenged a group of engineers to develop the best luxury car in the world. Hundreds of prototypes and thousands of test miles later, the LS 400 emerged.

Customers flocked to the 80 carefully selected Lexus dealerships across the country and read media reviews that included magazine reports saying the LS 400 “had come about as far toward the achievement of true automotive perfection as we could come,” “the Lexus transports you literally and figuratively into another dimension,” and “we are frankly astounded that the LS 400 is this great.”

But just as Lexus was gaining speed, it hit a roadblock. Shortly after the launch, two minor quality issues were discovered in the LS 400. A few people complained that the third high-mounted stoplight was not as bright as it should be and one customer complained about a cruise-control malfunction.

Lexus faced the challenge head-on. It recalled all 8,000 vehicles that had been sold, picked them up from their owners, fixed the problem and returned the cars washed, with a full tank of gas. Owners also received a gift as a thank you for their understanding.

Instead of stopping the young brand in its tracks, this unprecedented customer outreach established a new level of customer service that propelled the brand even further.

In 1991, Lexus introduced an all-new ES 300 as well as the SC 400 and SC 300 sport coupes. By this time there were 141 Lexus dealers across the country and Lexus outsold both Mercedes-Benz and BMW to become the best-selling luxury import brand in the U.S.

Through the early 1990s, Lexus continued to hone its brand and its products, as reflected by numerous quality and customer service awards from a variety of organizations. Lexus also introduced the GS 300 luxury sport sedan in March 1993.

But by 1995, Lexus was facing some new challenges. The economy was weakening, the yen was
fluctuating against the dollar, and Lexus spent months in flux as the U.S. and Japanese governments
negotiated on proposed 100 percent tariffs on Japanese luxury cars.

The tariffs didn’t happen, and the overall luxury market kept on growing. Lexus brought out the LX 450 luxury sport utility vehicle in 1995 and new versions of the ES in 1996 and the LS and GS in 1997.

Then, in 1998, Lexus showed how it uniquely listened to customers. When talking to customers about their SUVs, owners consistently said, “I love my SUV, but….” Lexus heard about rough rides, difficult entry/exit and a lack of luxury. To solve those issues, Lexus introduced the RX 300 in 1998, which created the luxury crossover segment. Thirteen years later, the RX continues to be the segment leader. The same year, the new LX 470 luxury sport utility vehicle debuted. In July of that year, Lexus had higher monthly sales than any luxury competitor – a first for any international automaker. Lexus became the topselling luxury brand in the United States in 2000, a title it held for eleven consecutive years.

In the early part of its second decade, Lexus starting moving beyond its traditional segments to introduce new vehicles to people who may not have considered Lexus previously. In July 2000, Lexus developed a second offering in the entry-luxury sedan category with the IS 300 sport sedan. The next
year, Lexus updated its classic SC model and turned it into a hardtop convertible. The GX 470 mid-size
luxury sport utility vehicle was added to the stable in 2002.

With its extensive selection of sedans, luxury utility vehicles and a hardtop convertible, Lexus was offering products in nearly every luxury segment. It was time to start demonstrating Lexus’ passion and its pursuit of innovation.

Lexus made its mark by introducing the world’s first luxury hybrid vehicle. The RX 400h went on sale in April 2005. With its lower emissions, improved fuel economy and outstanding luxury, it demonstrated that eco-conscious buyers didn’t need to sacrifice luxury to be kinder to the earth.

Lexus’ second hybrid offering, the GS 450h hybrid luxury sport sedan, went on sale in April 2006, and the LS 600h L premium hybrid sedan, the world’s first full V8 hybrid vehicle, went on sale in July 2007. In 2008, the HS 250h entry luxury sedan was announced and joined the Lexus hybrid family in August 2009. Most recently the CT 200h premium compact hybrid vehicle debuted at the Geneva Auto Show in March 2010 and went on sale in March 2011.

While Lexus’ image was definitely shifting from its traditional attributes of being reliable and luxurious, it still needed something to showcase its passion for performance. In February 2008, the IS F high-performance luxury sedan became just the answer. Powered by a 416-hp V8 engine, the Lexus IS F was the most uncharacteristic car Lexus had ever built, and it demonstrated that the brand really could make a car for high-performance enthusiasts. For those customers who wanted more performance on their standard IS 250 or IS 350 sport sedans, the company responded by introducing the F Sport performance accessories through dealerships.

Whether it’s making performance parts, introducing new and exciting products, or treating each customer as a guest in our home, Lexus’ pursuit of perfection comes through.

Today, Lexus has 229 dealers who have invested billions of dollars in creating state-of-the-art facilities and services to ensure that customers continue to drive the division. The information gathered from dealers, as well as from luxury customers across the country, feeds back into everything Lexus does.

As Lexus closed out its second decade, it expanded its model line-up to meet the varied needs of our customers. In spring 2009, the next-generation RX 350 luxury utility vehicle went on sale, followed by the RX 450h luxury hybrid in July. Lexus also added to its IS line in May 2009 with the all-new IS 250C and IS 350C convertible versions of the popular entry-luxury sport sedan.

September 2009 marked Lexus’ official 20th anniversary. It was also the first full month of sales for the 2010 HS 250h, the world’s first luxury car available exclusively with a hybrid powertrain. With a combined EPA-estimated fuel rating of 35 mpg, earned it one of the best combined fuel mileage of any U.S. luxury vehicle, as well as being equipped with amazing technological features and innovations. In
December 2009, Lexus introduced an all-new, second-generation GX 460 luxury utility vehicle, which
was more powerful, more efficient, quieter and more luxurious than the GX 470 model it replaced.

On the journey into its third decade, Lexus brought two new vehicles to the U.S.. The much anticipated flagship of the F portfolio and Lexus’ first supercar, the 2012 LFA, began arriving in January 2011 and concludes delivery in 2012. Only 500 hand-assembled LFAs are planned for production. The 2011 CT 200h, Lexus’ second dedicated and fifth luxury hybrid vehicle, went on sale in March 2011 with a combined EPA-estimated fuel rating of 42 mpg.

In February 2012, Lexus will introduce the fourth-generation GS. It has been completely redesigned, inside and out, and will feature the brand’s new design philosophy, with styling cues such as a distinctive new front grille, that will soon be seen on all future Lexus vehicles. The new GS will also lead the rest of the Lexus lineup in an entirely new direction of driving dynamics. With its dedication to being a driving force in both product and customer service innovation, look for Lexus to make great leaps in the future.

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